Ng Cheuk Hang v. Wams Design Ltd

DCCJ 171/2018

[2022] HKDC 27

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 171 OF 2018

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Before:  His Honour Judge Harold Leong in Chambers

Date of Hearing: 20 September 2021

Date of Decision:  13 January 2022

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DECISION

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1.There are two summons before the court:-

(a)  The defendant’s summons for additional judgment or leave to appeal; and

(b)  The plaintiff’s summons for varying costs order nisi.

2.The court will deal with the defendant’s summons first.

Background

3.This is a contractual dispute case for a renovation project.  There were a large amount of documents including quotations, variations, invoices, design plans etc and many items were in dispute.

4.The judgment was handed down on 17 September 2020 but not sealed as yet.  The defendant’s summons was raising issues that some of the disputed items were not mentioned in the judgment.

5.The defendant has identified 3 issues regarding the judgment, namely, the omission of some “undercharged” items in the Quotation, the omission of some “undercharged” items in a variation order, and the methodology of calculation of net balance used by the court.

Adjustment of work done under items 6.9 (sensors), 12.11 and 12.26 of the Quotation version R4 dated 20 August 2017

6.There is no dispute that the Quotation signed was for budget estimation subject to final measurements (thus possible findings of both “overcharging” and “undercharging” in the Quotation). The court was involved in determining such having consideration of the experts’ opinion.

7.The final assessment by the defendant’s expert was that there were “undercharging” of these 3 items for a total of HK$13,749 and there was no contrary opinion or evidence produced by the plaintiff or his expert.

8.But these items omitted in the calculation in the judgment.

Adjustment of work done in VO26

9.In the judgment, the court has omitted to take into account some items (items 9 and 10) of VO26 which were adjustments due to re-measurements of works (the light troughs in the false ceiling). These items were assessed by experts from both sides and both agreed that there were “undercharging” and therefore there should be upward adjustments.  The plaintiff’s expert opined this should be HK$43,650 and the defendant’s expert HK$118,350.  In either case, there was no dispute that adjustment on these items was necessary but the court did not take account of these in the calculation in the judgment.

The methodology calculation of the net balance due and payable

10.The court has adopted a simplified version of the calculation which showed a different result than if the court has followed the calculation used by the experts using the same figures.

Legal principles

11.Order 22 Rule 11 of the Rules of the District Court is known as the “slip rule” which provides that “Clerical mistakes in judgments or orders, or errors arising therein from any accidental slip or omission, may at any time be corrected by the court on summons without an appeal.”

12.Beyond correcting any “slips or omission”, before an order for the judgment has been drawn up or perfected, the court has a wider power to rectify mistakes in the judgment.  In Tim Lee Construction Engineering Co Ltd v Kwong Wah t/a Super King Engineering Co, HCCT 18/2010, unreported (10 May 2010), it was stated:-

“In this case, although judgment was handed down, no order has been drawn up or perfected.  Before sealing of the order, it is clear that there is general jurisdiction for the Court to revisit its judgment and rectify mistakes in it.  This jurisdiction is not to be confused with the “slip rule” under order 20, rule 11 of the Rules of the High Court.

There are English authorities on the principles as to how the jurisdiction is to be exercised, for example, in Re Harrison’s Settlement [1955] Ch 260; Steward v Engel [2000] 1WLR 2268; and Noga v Abacha [2001] 3 All ER 513.  In Hong Kong, the exercise of the jurisdiction was discussed in some detail by the Court of Appeal in Sun Jianqiang v Trans-Island Limousine Service Ltd [2004] 1 HKC 533.  I need only to quote the following passages in the judgment of Woo JA:

In Noga Rix LJ’s view on the subject, as follows:

“The court’s jurisdiction to reconsider its judgment before its order had been perfected could only be exercised in a case which raised considerations, in the interests of justice, which were out of ordinary, extraordinary or exceptional. An exceptional case did not have to be uniquely special, and “strong reasons” was perhaps an acceptable alternative to “exceptional circumstances” There were, of course, cases where an error of fact or law might be too plain for argument, and it was better that the error was corrected without imposing on the parties the need for an appeal. It was wrong, however, for a judge to be treated to an exposition such as would be presented to a court of appeal…”

Woo JA continued:

… Examples of strong reasons included a plain mistake on the part of the court …

… Those authorities also discuss the advantage and disadvantage of reopening a decision, in that on one hand there must be certainty and finality of a court’s decision…while on the other, where justice demands and an appeal can be averted by a judge reopening his order and reversing it if it is plain that he was wrong, so as to save the expenses of an appeal.”

13.I am of the view that, in the current case, the matter does not even go as far as “reversing” a plainly mistaken decision.  There is no mistake as far as the finding of accountability of each party on the issue of liability is concerned.

14.The first 2 issues raised by the defendant only concerned with the calculation of quantum regarding certain items (out of the rather voluminous numbers of items).

15.Paragraph 77 of the judgment had plainly stated that the court would, whenever assisted by experts’ report, account for any “overcharging” and “undercharging” in the renovation work.  The first two issues were items which both experts agreed as being “undercharged” but yet omitted in the calculation of quantum.

16.As far as issue 2 is concerned, from reading of paragraphs 92 to 94 of the judgment, it was clear that the court was criticising that an attempt by the defendant to tease out individual structures in the design of the false ceiling and to charge each separately was “over-billing”.  But there was no mention of the re-measurement of the length of the light trough which both experts agreed was “undercharged”.  The physical length of the light trough had nothing to do with “overbilling the design”. As such, I do not agree with the defendant that issue 2 must necessary be the subject for an appeal.

17.Therefore, issues 1 and 2 were obviously data omitted from the calculation of quantum by mistake.  They were simple omission and would not even go as far as “reversal” of a mistaken decision.

18.For the last issue, the concern was that the methodology of calculation on quantum was mistaken given the same factual findings on the figures.  This would be a plain simple mistake in arithmetic.

19.As such, I cannot see why the first two issues cannot be resolved under the “slip rule”, and the third issue, if not under the “slip rule”, would have been covered by the general jurisdiction as stated in the precedents above.  Bearing in mind that the gist of the judgment was that the costs and time involved in this claim was totally disproportionate to the actual size of the claim involved, it was clearly a very strong reason in the interest of justice that the plain arithmetic error be corrected without imposing further costs and time for an appeal.

20.As such, I cannot see why the issues cannot be dealt with in a corrigendum and so I would allow the application for additional judgment on all 3 issues.

Plaintiff’s application to vary the cost order nisi

21.The plaintiff’s application was based upon a claimed Sanctioned Offer in a letter dated 29 April 2020 which stated:-

“…we are instructed to make a sanctioned offer…the terms of which are set out below:-

1. Our client is prepared to accept the sum of HK$60,000 (inclusive of interest and costs) in full and final settlement of our client’s claim and of your client’s counterclaim.

2. Your client may accept this sanctioned offer within 28 days without leave of the Court.  After the expiry of 28 days from the date of this sanctioned offer, your client may accept the same if the parties agree on the liability for and quantum of costs incurred; or the court grants leave to accept it.”

22.In the original judgment before the additional judgment in form of the corrigendum, the defendant would have failed to beat the claimed sanctioned offer.  On this basis, the plaintiff was seeking to vary the costs order nisi to that the defendant do pay costs of the action after 30 May 2020 on an indemnity basis etc.

23.During the hearing, the court heard arguments on whether the wordings on plaintiff’s offer conformed to the requirement of a Sanctioned offer and whether the court should exercise any discretion regarding costs under the circumstances of this case.

24.However, in view of the additional judgment now putting the quantum at HK$10,588, the defendant has beaten the plaintiff’s offer so this argument is largely irrelevant.

25.The plaintiff’s application should therefore be dismissed.

Costs

26.As for costs, in view that the court was not entirely with the defendant (regarding the necessity for an appeal on issue 2), that the plaintiff’s application failed only upon the additional judgment and recalculation, and, importantly, the overall circumstances of this case especially regarding proportionality of time and costs, I would give an order nisi that there be no order as to costs for both the defendant’s and the plaintiff’s applications.

Mr Forest Fong Lum Hoi, instructed by Hau, Lau, Li & Yeung, for the plaintiff

Mr Yan Kwok Wing, of Fung Wong Ng & Lam LLP Solicitors, for the defendant